After reports surfaced last Thursday, Sanderson Farms released a statement saying that it had not received a proposal from Tyson Foods and Durational Capital Management for a buyout but noted that it had rejected a proposal from Duration Capital Management.
“The Sanderson Farms board of directors has unanimously rejected an unsolicited proposal from Durational Capital Management, a new shareholder, to acquire the company for $142 per share -- a price that very substantially undervalues Sanderson Farms and its future prospects and is significantly below the 52-week high share price of $179.45,” the company said in a statement. “After careful consideration, with the assistance of its financial and legal advisors, the board unanimously determined that the highly conditional and opportunistic proposal is not in the best interests of Sanderson Farms or its shareholders.”
Sanderson said its board remains committed to enhancing value for all shareholders and believes it can generate significant additional value by continuing to execute its strategic organic growth plan. The plan was discussed at the company’s recent Investor Day, where it announced initiatives to increase production to serve the growing retail grocery market, including identifying and vetting a site for a new facility.
Centerview Partners LLC is serving as financial advisor, and Wachtell, Lipton, Rosen & Katz, Fishman Haygood LLP and The Brunini Law Firm are serving as legal counsel to Sanderson Farms.
Durational Capital Management was founded in 2017 with a focus on investing in consumer businesses with a long-term horizon and implementing operationally focused strategies. The company currently owns Bojangles Inc., a quick-service chicken restaurant chain based on southern recipes.